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PNG Government Plans To 'Trim Back' Pay Increases For Public Employees

Submitted by PIR Editor on Thu, 11/24/2016 - 09:34

Budget deficit requires cuts: Public Service Minister

PORT MORESBY, Papua New Guinea (The National, Nov. 24, 2016) – The Government will “trim back” any pay increases for public servants in the next two years when it will be operating on a deficit budget, says Public Service Minister Sir Puka Temu.

He pointed out that the three-year industrial awards for the public service, the teaching service and the police (which flowed on to the Correctional Service and the Defence Force) would expire at the end of this year.

Sir Puka said the Government would be operating against a deficit budget next year and would “trim back on pay rises for the next two years”.

“But in the expectation that Government income from rising world commodity prices will progressively improve, a mid-year review of pay and conditions can be considered in 2018,” he said.

“If the financial situation has improved sufficiently, a further pay rise could be implemented in 2019.”

The Government urged public sector unions to “show understanding and reduce their claims against the State” in view of these financial difficulties.

He advised them to look forward to a “return to better times” when commodity prices are higher, and growth in the economy improves.

Sir Puka said public servants had enjoyed “good times” between 2009 and 2014.

“Free education and health services have been introduced benefiting union members,” he said.

He said “substantial pay rises averaging 7.5 per cent per annum” were awarded between 2011 and 2016.

“These increases had been structured to favour the lowest paid. Over the six-year period, the average earnings of the lowest paid workers increased by 75 per cent while the average public sector pay rose by 55 per cent.”

He said police constables, teachers and nurses “witnessed pay increases of a higher magnitude over this period”.

“In 2010, the lowest paid public servants were earning K320 per fortnight. Today they are earning K600 per fortnight. The entry salaries of base grade teachers increased from K390 to K900 per fortnight, base grade nurses from K450 to K820 per fortnight and base grade police constables from K600 to K1050 per fortnight.”

Sir Puka said the Government must keep the pay bill at sustainable levels in line with projected revenue.

“For this reason, the Government has also directed that there will be a freeze on reorganisation, the engagement of non-essential staff and non-essential payments through Government payrolls.”

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